There’s more to being a landlord than simply collecting rent. From keeping detailed records, overseeing repairs and maintenance, and shouldering certain financial responsibilities, this job isn’t exactly a walk in the park. To successfully rent out a property, you need to put in a lot of work. Here’s what you need to consider before you decide to become a landlord.
The true cost of renting a property
When it comes to renting out a property, you need to spend money to make money. There are plenty of expenses you’ll need to shoulder before you start hosting tenants. The following are just a few overhead costs and incidentals you need to keep in mind:
- Mandatory fees (e.g. the full Electrical Inspection Condition Report (EICR) cost of £199, the cost of a gas safety certificate at £45, and the cost of an Energy Performance Certificate (EPC) at £65)
- Regular maintenance and repairs
- Income taxes
- Property management fees
- Landlord insurance
Be prepared to set aside some money to cover these. Some of them need to be paid annually, while some are only one-time payments.
The laws, rules, and regulations
There are certain laws and regulations that are specific to your location, and you need to be aware of them before you start renting out your property so you don’t get in trouble. Reach out to your local council and speak to someone who can guide you through the rules and regulations behind renting a property and being a landlord so that you can ensure that your operation is legitimate.
The perfect tenant
Tenants aren’t the only ones looking for the right fit. You need to be just as meticulous about finding the right match when it comes to your tenant. Put up an ad for your property rental in legitimate real estate marketplace platforms, not dodgy websites. As a landlord, you have a responsibility to do your due diligence and get to know your prospective tenants. Do your research and conduct interviews with them. You have the authority to reject a tenant if they have no right to rent.
The work hours
Unlike a regular employee at an office, you don’t exactly adhere to regular work hours. This occupation isn’t exactly a 9-to-5 job. Your tenants can call you at all hours of the day unannounced to help them address an issue with the property. Some issues can take an entire day to resolve, while others might only take a few minutes to troubleshoot. You have to be prepared to be accessible at all times and to work odd hours as a landlord.
Your lease should be fair to both you and your prospective tenant. You have the option of creating the lease yourself from scratch, but this can be quite difficult and you might fail to comply with the law or overlook an important clause. There are some basic templates which you can use too, but they’re quite generic, and may not be as comprehensive. The best option would be to cough up some money for an attorney who can help you draft one instead.
These are just some of the most important things to keep in mind if you’re considering putting your property up for rent and becoming a landlord. If you’re willing to put in all this work, then this could be a lucrative and fulfilling career path for you.